Foreclosures blamed as home prices fall 6.3%

7/22/2011

WASHINGTON — U.S. home prices fell 6.3 percent in May from a year earlier as foreclosures weigh down values and purchases slump.

The decline was led by a 9.9 percent decrease in the region that includes California, the Federal Housing Finance Agency said Thursday in a report.

Foreclosures have boosted the supply of available homes and reduced prices because the properties sell at a discount. Low interest rates have done little to stimulate demand for homes as mortgage standards tighten.